When a couple separate it can be a minefield. It is usually
unknown territory for them and an understandably confusing time.
When they first make contact with a lawyer they have no idea what
that lawyer might need from them. Lawyers cannot help them through
the emotional issues involved in the separation, their role is to
sort out the legal issues. This may seem very obvious but often the
line is blurred and without realising it emotional issues can
impact on the ability to resolve legal matters and move on.
When sorting out legal issues the first step is to assess what
the net position is of the couple. The starting point under the
Property (Relationships) Act is to share all relationship property
equally. There needs to be disclosure of all assets and liabilities
in which either may have an interest. Information that is needed to
assist in this assessment includes:
Copies of bank statements for the separation date. This
includes for joint bank accounts and accounts in your sole name, or
in which you might have an interest with other people. For instance
I have had clients who have a holiday account with a friend for a
planned week away. This account has been contributed to from income
into the relationship and therefore it is relationship
Details of any superannuation or kiwisaver entitlements, both
at the start and end of the relationship.
Details of any life insurance policies. These days most are
death only policies but sometimes there is a value that needs to be
taken into account. At the very least they may need to be
transferred so that the owner of the policy is the person
Assessment of any property values. If one person is wishing to
retain any property then a registered valuation is likely to be
required but often couples will rely on a real estate agents
Details of any debts, this includes mortgage, personal loans,
store cards and credit cards or HP arrangements. Are there any
interfamily loans that need to be taken into account. This is
increasingly common in today's housing market.
Details of any companies the couple may have. These may need to
be properly valued but a starting point would be the most recent
set of financial accounts.
Details of vehicles. Often people simply keep the vehicle they
drive without adjustment but a value close to separation should be
Chattels are usually able to be sorted without too much
difficulty however if there is likely to be an issue then they
should be valued. They can then be divided by agreement and if
necessary any adjustment for a monetary difference can occur with
all other adjustments.
Details of any other shares that might have been acquired
during the relationship. These might have been acquired as part of
an employment contract or simply purchased during the
Details of any other assets. For instance boats, ride on
mowers, expensive recreation equipment or say horses.
Copies of any agreements entered into by the couple making
their own rules about property sharing.
Details of any Trusts, including copies of trust deeds,
associated documents, financial statements, and property owned,
along with any debt back that might be owed, distributions made and
details of transfers to the trust. Obviously trusts established
during the relationship, or by one of the parties are the most
relevant however even trusts established by third parties could be
open to scrutiny.
It is not expected that all information will be immediately
available. Some will only be available after the other party
provides it. For instance a bank will not release information about
someone else's separate accounts. However with online internet
banking available often both parties do have access to the others
Sometimes it is when bank statements are looked at that other
assets are discovered. This obviously could be other unknown bank
accounts but it could even alert you to properties you did not know
For property division agreements to be binding there must be
proper disclosure of all assets in which each party is entitled to
share and both parties must have their own lawyer advise them as to
whether they should sign the agreement. It is important that any
agreement is completed in a considered way, without any suggestion
of duress. The saying "marry in haste repent at leisure"
could equally apply to resolving property division on
If parties feel comfortable having discussions between
themselves directly around property division we encourage our
clients to do this. However, it is very important that they do not
agree to anything until they have had legal advice.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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To ensure that all possible problems are considered and addressed, the transactions must be appropriately documented.
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